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A selection of whiskeys at the Abington Wine and Spirits Store in Chinchilla on Tuesday. Butch Comegys / Staff Photographer

HARRISBURG — Your booze prices are safe.

The state Liquor Control Board will not be increasing the markup it sets on liquor and wine this fiscal year, according to Board Chairman Joseph E. "Skip" Brion. He announced that Wednesday after publication of an internal agency memo saying an additional 5 percent markup on prices would help offset rising expenses.

A retail markup, which is placed on top of taxes, is the percentage the LCB or a business adds to the price of a product to make a profit on sales. The LCB's markup on a bottle of liquor or wine has been set at 30 percent since 1993.

The markup, along with an 18-percent Johnstown Flood tax and bottle handling fees of 50 cents to $2.50 are built into the shelf price consumers see. At the cash register, consumers pay an additional 6 percent to 7 percent sales tax.

The memo, written by LCB's financial director, suggested the agency could raise the markup to 35 percent, which could have raised shelf prices on some but not all products.

The memo estimated LCB's net income will decrease 20 percent to $96.2 million in 2014-15 due in large part to personnel costs for salaries, benefits and pensions. At the same time, the memo projects sales will rise just 3 percent due to slower demand seen in the latter half of 2013-14 in Pennsylvania and nationwide.

Those projections are not reason to raise the markup percentage, Brion said in a response to a reporter's question during a board meeting Wednesday.

"We're not increasing the markup," Brion said, according to ABC27, a Harrisburg area television station.

On Thursday, LCB spokeswoman Stacy Kriedeman said the memo was part of the financial director's annual estimates on sales projections, upcoming expenses, expected profit and ideas on how to generate more profit, a "significant portion of which is transferred to the state's budget.

"He provides an overall picture of the fiscal health of the agency," she said. "The agency is in good financial shape but he wanted to make the board was aware of expenses we will have to account for in the coming year."

LCB has not released its profits report for the 203-14 fiscal year that ended June 30, Kriedeman said. But the agency had a banner year, she said, with sales increases of about 3.2 percent to nearly $1.8 billion. The agency sent more than $500 million of the profits to the state.

"We continue to look at alternate ways to increase revenue in an effort to leave the markup as it is," Kriedeman said. "At the end of the day, our profit or a portion of our profit goes back to the general fund to benefit Pennsylvania's citizens by providing funding for essential services."

Gov. Tom Corbett and some Republican lawmakers have sought to sell off the system. Corbett and other supporters of privatization argue the state should not be in the business of sells alcohol.

Pennsylvania and Utah are the only states that control the wholesale and retail aspects of the booze business. Multiple states control retail or wholesale sales.

A bill to privatize the LCB was passed in the House in 2013 but died in the Senate. The Senate has failed to pass its own bill to change the state liquor system.

If both chambers do not agree on a liquor bill by Nov. 12, the last day of the two-year legislative session, the 2013 House bill will expire.

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